We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
LOCO vs. TXRH: Which Stock Should Value Investors Buy Now?
Read MoreHide Full Article
Investors with an interest in Retail - Restaurants stocks have likely encountered both El Pollo Loco Holdings (LOCO - Free Report) and Texas Roadhouse (TXRH - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, El Pollo Loco Holdings is sporting a Zacks Rank of #2 (Buy), while Texas Roadhouse has a Zacks Rank of #4 (Sell). This means that LOCO's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
LOCO currently has a forward P/E ratio of 19.61, while TXRH has a forward P/E of 25.11. We also note that LOCO has a PEG ratio of 1.96. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TXRH currently has a PEG ratio of 2.12.
Another notable valuation metric for LOCO is its P/B ratio of 2.11. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, TXRH has a P/B of 4.81.
These are just a few of the metrics contributing to LOCO's Value grade of B and TXRH's Value grade of D.
LOCO stands above TXRH thanks to its solid earnings outlook, and based on these valuation figures, we also feel that LOCO is the superior value option right now.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
LOCO vs. TXRH: Which Stock Should Value Investors Buy Now?
Investors with an interest in Retail - Restaurants stocks have likely encountered both El Pollo Loco Holdings (LOCO - Free Report) and Texas Roadhouse (TXRH - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, El Pollo Loco Holdings is sporting a Zacks Rank of #2 (Buy), while Texas Roadhouse has a Zacks Rank of #4 (Sell). This means that LOCO's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
LOCO currently has a forward P/E ratio of 19.61, while TXRH has a forward P/E of 25.11. We also note that LOCO has a PEG ratio of 1.96. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TXRH currently has a PEG ratio of 2.12.
Another notable valuation metric for LOCO is its P/B ratio of 2.11. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, TXRH has a P/B of 4.81.
These are just a few of the metrics contributing to LOCO's Value grade of B and TXRH's Value grade of D.
LOCO stands above TXRH thanks to its solid earnings outlook, and based on these valuation figures, we also feel that LOCO is the superior value option right now.